2017 (9) TMI 1468 - AT - Customs

Benefit of N/N. 21/2002-Cus dated 01.03.2002 - Concessional rate of duty - import of Micronized Progesterone BP - The form of import being bulk, the Revenue contends that it should be under 80 (B) - Held that - similar issue decided in the case of CIPLA LTD. Versus COMMISSIONER OF CUSTOMS, CHENNAI 2007 (8) TMI 131 - CESTAT, CHENNAI , where it was held that admittedly, the bulk drugs imported by the appellants were specifically mentioned in List 3 appended to Sl. No. 80(A) of Customs Notification No. 21/02 and are liable to be considered as drugs mentioned at 80(A). It is beyond doubt that bulk drugs are also drugs. They are so defined under the Drugs (Prices Control) Order, 1995 also - appeal allowed - decided in favor of appellant.

Summary

Issues:
1. Interpretation of Notification No. 21/2002-Cus regarding concessional rate of duty for imported bulk drug Micronized Progesterone BP.
2. Applicability of Sl.No. 80 (A) or 80 (B) of the said notification.
3. Compliance with the procedure set out under 1996 Rules for concessional rate of duty.

Analysis:
1. The appeal addressed the dispute arising from the order of the Commissioner (Appeals), Customs, Chennai concerning the concessional rate of duty claimed by the appellant for importing Micronized Progesterone BP under Sl.No. 80 (A) of Notification No. 21/2002-Cus dated 01.03.2002. The Revenue argued that the product should be assessed under Sl.No. 80 (B) due to non-compliance with the procedure set out under 1996 Rules, leading to the disallowance of the concessional rate of duty.

2. The appellant's counsel contended that the imported product, Micronized Progesterone BP, is listed under Sl.No. 58 of List 3 of the notification, making their claim for the concession clear and unambiguous. The counsel cited previous Tribunal decisions, including CIPLA Ltd. Vs. CC, Chennai 2007 (218) ELT 547 (Tri.-Chen.), to support their argument.

3. The Revenue's representative opposed the appeal, emphasizing that the imported goods were in bulk form and not intended for retail sale. After hearing both sides and examining the records, the Tribunal focused on the interpretation of entries under Sl.No. 80 of the notification, distinguishing between goods specified in List 3 (80 (A)) and bulk drugs used in manufacturing those goods (80 (B)).

4. The Tribunal observed that the imported product, Micronized Progesterone BP, fell under List 3 and was specifically covered under 80 (A) of the notification. Referring to the CIPLA Ltd. case, the Tribunal emphasized that bulk drugs are also considered drugs and are eligible for the concessional rate of duty under 80 (A) if listed in List 3. Relying on the precedent, the Tribunal concluded that the impugned order disallowing the concessional rate of duty was unsustainable, setting it aside and allowing the appeal.

In conclusion, the judgment clarified the proper interpretation of the notification regarding concessional duty rates for imported bulk drugs, emphasizing the importance of specific listings and the applicability of relevant provisions to determine eligibility for such benefits.